By Yunusa Tanko Abdullahi
Perhaps considering the popular saying that ‘what is worth doing is worth doing well’, the Federal Government has reiterated its commitment towards building a vibrant capital market that would contribute to the growth and development of Nigeria.
In view of the fact that the country is making a lot of efforts in diversifying the economy, increasing revenues, and plucking leakages to aid investment in small and medium enterprises and provide infrastructure, Mrs. Zainab Ahmed, the Honourable Minister of Finance, Budget and National Planning, emphasises the central role played by the capital market in the development of the economy, through mobilising long-term savings for investment as well as efficient pricing of financial instruments.
During her visit to the Nigerian Stock Exchange (NSE) recently in Lagos, she disclosed that the Federal Government would further introduce incentives to boost investments in the nation’s capital market. She said that the finance ministry would work closely with the exchange to put in place policies that would boost investment and enhance the growth of the market.
She had then noted that government in the past had worked with the NSE in various ways to ensure market growth and development. According to her, some tax provisions made in the Finance Act of 2019 will assist in deepening the market in areas of Real Estate Investment Schemes (REITS) and securities lending.
In her words: “Given the need to accelerate reforms to attract the capital available for real estate development across the continent, we have worked very closely with the SEC, industry groups and the Capital Markets Master Plan Implementation Council for several years, to reform our tax laws.”
“We have asked the NSE to continue to work with us so that we can encourage Nigerians to invest more in the Nigerian capital market. We have a lot of resources locally and we are working with the NSE to ensure we mobilise resources through the market. Any policy that government needs to put in place to enable the growth of the market, we will do that,” Ahmed said.
The minister assured the capital market community that the next Finance Act would make provisions for incentives that would make the market more attractive to investors. She said the Finance Act of 2019 had taken care of some incentives, adding that, every appropriation bill, going forward, must come with finance bill on yearly basis.
Responding to the capital market operators’ plea to defer the planned recapitalisation exercise in the market, she rather encouraged that the exercise would make them stronger and more competitive. She explained that with the demutualisation of the exchange, stockbroking firms would have more businesses to embark on and therefore needed to recapitalise to operate better.
Also, responding to comments by stockbrokers that many ministers had in the past come to the NSE with many promises without fulfilment, Ahmed again assured the market operators that her visit would be different. She promised the brokers of a commitment to ensure that the capital market was used to unlock the economic potential of the country.
She often openly would note that, over the years, the capital market has provided the platforms through which corporates and governments source capital to expand their operations and provide amenities for its citizens.
The Honourable Minister will do all within her power to strengthen relevant market institutions by building and ensuring a healthy and competitive financial system that is better positioned to support private sector and contribute towards the sustainable development of the Nigerian economy.
Given her interest in the real sector, in the wellbeing of Nigerians and in the broadening the market, she not long ago had said: “Indeed, just as the Capital Market master plan, the ERGP policy objectives for the financial sector is to further diversify instruments of the stock market, review the capitalisation of the financial institutions and encourage lending to the real sector of the economy and encourage of the economy.”
“All of these are necessary for us to be able to create jobs, wealth and increase the standard of living of our people and the capital market is central to all of these efforts. I want to urge all of you here today to continue to partner with the government in its bid to achieve policies that it is committed to in the ERGP,” she added.
Earlier, in his welcome address, Mr. Oscar Onyema, Chief Executive Officer of NSE, said they were delighted and honoured to host the minister and her delegation to the event themed: ‘A day at the NSE.’ Onyema said the initiative was one in a series of the NSE’s renewed government relations, where key government stakeholders interacted with the capital market community on important issues that affected the market. He said that the issues ranged from Nigeria’s economic management and policy reforms to ease of doing business, foreign and local investment attractiveness, among others.
*Abdullahi is Finance Minister’s Special Adviser(Media & Communications).